Consumer Confidence Up, Banks Fall

123jump.com Staff
28 Apr, 2009
New York City

U.S. stocks edged higher as consumer confidence rises and worries related to adequacy of banks kept stocks in the sector lower. World Health Organization raised its swine flu alert to the highest level since 2005. U.S. Steel dropped. China based Baidu earnings rose 23%.

[R]11:20AM New York – U.S. stocks edged higher as consumer confidence rises and worries related to adequacy of banks kept stocks in the sector lower.[/R]

S&P 500 index gained 1.46 or 0.2% in the morning trading as consumer sentiment improved and market digested barrage of earnings and World Health Organization raised its alert for flu to the highest level since 2005.

The health organization in its alert cited that more than 150 people in Mexico have died and the flu can no longer be contained. The alert, set up since 2005 was raised to phase 4 indicating sustained human to human transmission. The next phases 5 and 6 in alert represent widespread human infection.

The alert noted, “Given the widespread presence of the virus, the Director-General considered that containment of the outbreak is not feasible. The current focus should be on mitigation measures.”

Of the stocks in S&P 500 index, 155 increased, 341 declined and 4 were unchanged.

Jacobs Engineering led decliners with a loss of 8% followed by losses in Bank of America of 7.8%, in Marshall & Ilsley of 7.7%, in Corning of 6.9%, in Masco Corp of 6.7%, in Avery Dennison of 6.3%, in Regions Financial of 6.3%.

Waters Corp led gainers in S&P 500 index with a rise of 15.9% followed by increases in Office Depot Inc of 15.4%, Southwestern Energy of 10.3%, in Tellabs Inc of 8.01%, in Fortune Brands of 7.1% and in Coach Inc.

Banks traded lower after renewed media speculation that at least two banks have been asked to raise more capital. 123jump.com first noted in an article on Saturday, that most banks need additional capital. The Wall Street Journal suggested that Citigroup and Bank of America are disputing the request from the Fed to raise more capital.

United States Steel Corporation ((X)) lost 6.4% or $1.80 to $25.92 an integrated steel producer reported first quarter sales fell 47% to $2.75 billion from $5.2 billion a year ago. Net loss in the quarter was $439 million or $3.78 per diluted share compared to net income of $235 million or $1.98 per share a year ago.

Asian Markets Review

Honda Motor Co., Ltd, Japan’s second- largest carmaker said fourth quarter sales fell 41.6% to ¥1.784 trillion from ¥3.056 trillion a year ago. Net loss was ¥186.1 billion compared to net profit of ¥25.4 billion a year ago.

Net sales for the year 2008 fell 16.6% to ¥10.01 trillion from ¥12.00 trillion a year ago. Net income for the year fell 77% to ¥137.01 billion or ¥75.50 per diluted share compared to net income of ¥600.04 billion or ¥330.54 per share a year ago.

PetroChina Company Limited, an oil and gas producer and seller in the People’s Republic of China said first quarter revenues fell 30% to 181.58 billion. Net profit in the quarter fell 35% to RMB 18.96 billion compared to net profit of RMB 29.31 billion, a year earlier.

PetroChina Company Limited, in the last one year traded as high as RMB 18.97 in May 2008 and as low as RMB 9.71 in January 2009. Based on the yesterday’s closing price of RMB 11.46 the company has market cap of RMB 2.10 trillion.

Baidu, Inc, the China''s most popular search engine said first quarter sales rose 41% to Rmb 810.7 million from Rmb 574.4 million a year ago. Net profit in the quarter rose 23.5% to Rmb 181.1 million or Rmb 5.22 per diluted share compared to net income of Rmb 146.6 million or Rmb 4.22 per share a year ago.

Baidu, Inc, in the last one year traded as high as $382.90 in April 2008 and as low as $100.50 in December 2008. Based on the yesterday’s closing price of $224.86 the company has market cap of $7.77 billion.

The Nikkei 225 Index in Tokyo closed lower 232.57 or 2.67% to 8,493.77, Hang Seng index in Hong Kong decreased 285.31 or 1.92% closed to 14,555.11, CSI 300 index in China higher 5.24 or 0.21% closed to 2,518.53. ASX 200 index in Australia decreased 23.20 or 0.62% closed to 3,708.40. The KL Composite index in Malaysia lower 14.42 or 1.47% closed to 965.70.

The Kospi Index in South Korea decreased 39.59 or 2.95% to close at 1,300.24. SET index in Thailand closed lower 2.27 or 0.48% to 472.72 and JSE Index in Indonesia increased 19.83 or 1.26% closed to 1,595.92. The Sensex index in India decreased 370.10 or 3.25% closed to 11,001.75.

Europe Markets Review

Deutsche Bank AG ((DB)) plunged 5.5% or $3.08 to $52.40 after the Germany''s biggest bank reported first quarter revenues rose 57% to €7.2 billion from €4.6 billion a year ago. Net income in the quarter was €1.2 billion or €1.92 per diluted share compared to net loss of €141 million or €0.27 per share a year ago.

In London FTSE 100 Index traded lower 88.11 or 2.11% to 4,078.90, in Paris CAC 40 Index decreased 72.60 or 2.34% to 3,029.83 and in Frankfurt DAX index traded lower 121.46 or 2.59% to 4,572.61. In Zurich trading SMI decreased 95.87 or 1.85% to 5,080.10.